Kathleen, Linda, and Glen were three owners of two farm parcels. They held the land as tenants in common. They all signed a “restriction agreement” when the Glen bought into the property in 2001. The restriction agreement prevented any one party from selling or transferring to an outside party without first offering to the other two owners. This also included transfers that occurred due to the death of an owner. If the procedure was not followed, then that transfer of property would be “null and void and have no effect whatsoever.” The agreement would terminate when there is one original interest holder.  

In 2016, Kathleen transferred her property interest to herself and her husband, Virgil. This was contrary to the restriction agreement terms since no notice was given to the other two owners. Kathleen died in 2017 with her interest going to Virgil. Virgil died in January 2021.

Glen filed a petition asking the court to compel sale of the land pursuant to the restriction agreement. The respondent replied by arguing that the restriction agreement was an illegal restrain on alienation and therefore Glen had no purchase right.

The trial court determined that the restriction agreement was not illegal restraint on alienation. The appellate court affirmed the trial court and  found that the restrictive agreement was not a restraint on alienation. There was a termination date, the time to decide to buy after a proposed transfer is reasonable, range and frequency of options is reasonable, and has a reasonable pricing scheme.

In re Estate of Hoppert, No. 362694 (Mich. Ct. App. June 29, 2023).